Articles of Interest

Celebrate 50th by advocating expanded Medicare

LENOX, Mass. — Medicare, a federal government program for seniors and the disabled, will celebrate its 50th anniversary on Thursday, July 30. As one of our nation’s most popular and valuable programs, covering 17 percent of the U.S. population, it has reduced poverty among seniors and improved the financial security of their families.

Medicare was originally conceived as a first step toward covering every person in the United States under a national health program. Now is the time to follow through with this plan to expand Medicare to everyone, and to improve the program.

Rather than expanding and improving Medicare, some people want to decimate the program. One idea is to privatize Medicare by giving vouchers to patients to buy private insurance instead of paying their health care costs directly. This would result in reduced care, since the value of the vouchers would decline as health care prices increase.

Another proposal has been to increase the eligibility age, which would hurt millions of patients and also drive up costs. A third suggestion has been to increase cost-sharing, demanding higher premiums, deductibles and co-payments from patients, which would deter them from seeking care. Cutting Medicare with these proposals would not only increase costs, but also worsen health care outcomes and increase poverty.

Medicare is the victim, not the cause, of rising health care costs. In the short term, the financial integrity of Medicare could be improved by 1) an upturn in the economy, generating more tax receipts, 2) additional federal appropriations from general tax revenues, and 3) increasing the payroll tax by a tiny fraction of a percent to sustain the program (the last tax adjustment was in 1985).

And allowing Medicare to negotiate drug prices, as they do in other industrialized countries, would save money for the program. The recent news of Vertex’s pricing of $259,000 annually per patient for their new drug for cystic fibrosis makes it clear that the United States government needs to step in to control drug costs.

A new analysis of drug pricing in the U.S., compared to other countries with drug plans administered by their governments, found that Medicare pays twice as much as they do for the same drugs. The study estimated that Medicare could save $16 billion annually by negotiating drug prices to a level more in line with those of other countries.

Medicare Advantage plans, administered by private insurers, have been the inroad to privatize Medicare. But they have been a boondoggle that costs the Medicare program 14 percent more than traditional Medicare. The administrative costs of private insurance companies (12-30 percent), are much higher than the costs for traditional Medicare, which is less than 2 percent.

There is no question that private insurance companies, with their administrative waste and multi-million dollar CEO salaries, have failed the American people. They cherry-pick the healthy, screen out the sick, deny care, and decrease access to care with high deductibles, co-payments, and limited provider panels. Unfortunately, while the Affordable Care Act (“Obamacare”) has covered some of the uninsured, it builds on this faulty foundation of private insurance companies.

There is legislation in Congress, H.R. 676, the Expanded and Medicare for All Act, which would establish this national single-payer health care program, to:

Provide universal, comprehensive coverage, with no co-pays or deductibles.